Statoil Fuel & Retail: challenging fourth quarter, but robus.

7 February 2012 - Statoil Fuel & Retail ASA's ("Statoil Fuel & Retail"; ticker: SFR) fourth quarter 2011 adjusted EBITDA was NOK 617 million compared with NOK 729 million in 2010. Adjusted opeRating profit totalled NOK 333 million, which was NOK 112 million lower than the same period in 2010. For the full year, adjusted EBITDA was NOK 3,021 million compared with NOK 3,393 million in 2010. Return on Capital Employed (ROCE) in 2011 was 10.7 percent after tax.

"2011 was a challenging year for our industry, serving up everything from high refined oil prices to intensified competition in some of our most important growth markets. Our 2011 results document that our operations are robust and able to withstand market fluctuations. This is directly thanks to the extraordinary expertise and efforts of our people," says Jacob Schram, CEO Statoil Fuel & Retail.

Statoil Fuel & Retail's serious incident frequency (SIF - number of serious incidents per million manhours worked) was 1.8 for the fourth quarter of 2011, compared with 2.9 for the same period in 2010 - reflecting a 77 percent decrease in the number of robberies. The full year 2011 SIF of 1.8 compared favourably with 2.0 for 2010.

2011: solid performance in difficult market conditions



Results in the fourth quarter were impacted by the challenging market situation in Central and Eastern Europe, which continued to depress road transportation fuel unit margins. In Scandinavia there was an underlying gross profit improvement per litre of transportation fuel in the fourth quarter to NOK 0.65 compared with NOK 0.63 in 2010. However, a revaluation of the fuel inventory related to previous periods in Scandinavia had an adverse affect on the fourth quarter results, causing the reported gross margin per litre to be lower than in the same period last year. Fuel sales in the fourth quarter 2010 were particularly high due to the extreme cold, resulting in the sale of road transportation fuel as heating oil.

Statoil Fuel & Retail's overall performance in 2011 was solid. Transportation fuel volumes remained on par with 2010 as the company maintained its leading position in the Scandinavian fuel market and increased the number of its stations in Central and Eastern Europe. Gross profit for transportation fuel also improved, as did convenience, compared with 2010. The cost savings programme delivered ahead of plan for the year, partially compensating for increased standalone and separation costs.

"Our results reflect an underlying robust financial performance for Statoil Fuel & Retail in 2011, given the difficult market conditions in Central and Eastern Europe and our new standalone and separation costs," says Jacob Schram, CEO Statoil Fuel & Retail ASA. "The Board of Directors' dividend proposal is in line with our ambition of distributing at least 50 percent of our earnings per share."

Key figures for Statoil Fuel & Retail in the fourth quarter 2011

Robust Scandinavian growth in 2011

Statoil Fuel & Retail continued to hold the leading position among fuel retailers in Scandinavia. Gross profit from road transportation fuel increased as a result of improved fuel unit margins compared with last year, following strong micro market pricing management and the favourable development of refined oil product prices in the second quarter 2011. Twelve new stations were opened during the year, including three during the fourth quarter.

"Our aim is to further enhance our leading position in Scandinavia, expanding our network with new stations at strategically important locations," says Schram. "In the convenience market, we will continue our successful efforts in sales, innovation and product development."

Pressure on fuel unit margins in Central and Eastern Europe

Gross profit for the fourth quarter declined compared with the fourth quarter 2010 mainly due to lower contributions from road transportation fuel and a decline in gross profit from convenience and other products. Major players holding back fuel prices at the pumps continued to put pressure on fuel unit margins in Poland and Russia. In spite of positive development during the quarter, the gross profit per litre of road transportation fuel was somewhat lower than the same quarter last year. This downturn is also attributed to foreign exchange effects. Underlying gross profit for convenience increased in the fourth quarter as a result of higher sales.

Fuel volumes for the full year were slightly higher in 2011 when compared with 2010. Statoil Fuel & Retail added 51 stations to its full service and automat network in the region in 2011.

Gross profit from convenience increased somewhat in 2011, mainly as a result of successful marketing campaigns for MADE TO GO food line products and car wash.

"Current economic conditions and the pace of infrastructure development in Central and Eastern Europe give us reason to expect further growth in demand for road transportation fuel in the region. In the long term, the market fundamentals remain attractive. We stand by our ambition to expand our station network in Central and Eastern Europe, targeting 40-50 new full service and automat stations in 2012," says Schram.

Solid balance sheet and ROCE

Statoil Fuel & Retail ended the year with a solid balance sheet. The company's equity ratio is at 32.1 percent.

Return on Capital Employed (ROCE) for 2011 was 10.7 percent after tax, the second best year ever for the company compared with 11.1 percent for 2010.

Changes in pension plan

Statoil Fuel & Retail ASA and Statoil Fuel & Retail Norge AS have redesigned their pension plan. The redesign involves closing the existing defined benefits plan to new employees and introducing a defined contributions plan for those employed from 1 April 2012. These changes will be recognised in the income statement in the first quarter 2012 and are expected to have an immediate impact, reducing the net pension liability by approximately NOK 300 million. Future service costs will be reduced following the change.

Dividend payout

Statoil Fuel & Retail's ambition is to distribute at least 50 percent of its earnings per share. Based on this ambition, and taking into consideration expected cash flow, capital expenditure plans, financing requirements and appropriate financial flexibility in times of significant macroeconomic uncertainty, the Board of Directors of Statoil Fuel & Retail ASA proposes to pay a dividend of 50 percent of 2011 earnings per share, amounting to NOK 1.80 per share.

Please find attached, at the bottom of this page, the fourth quarter 2011 financial statements and review.

Contacts

Karen Romer, SVP Communications Statoil Fuel & Retail ASA, +47 950 74 950, karrom@statoilfuelretail.com

Mitra Hagen Negård, SVP Investor Relations Statoil Fuel & Retail ASA, Tel: +47 95 79 36 31, mine@statoilfuelretail.com

Presentation, live webcast and telephone conference

At 09:00 CET on 7 February 2012, Statoil Fuel & Retail presents its results for the fourth quarter 2011 at the company's headquarters at Sørkedalsveien 8, Oslo, Norway.

The presentation will be webcast live. For access to the webcast visit the Investor centre on our website at www.statoilfuelretail.com. A dial-in number to participate via telephone conference will also be available on our website.

About Statoil Fuel & Retail

Statoil Fuel & Retail is a leading Scandinavian road transport fuel retailer with over 100 years of operations in the region. We have a broad retail network across Scandinavia, Poland, the Baltics, and Russia with approximately 2,300 full-service (fuel and convenience) or automated (fuel only) stations.

Statoil Fuel & Retail's other products include stationary energy, marine fuel, aviation fuel, lubricants and chemicals. In Europe, we operate 12 key terminals, approximately 400 road tankers and 50 depots in eight countries. We also deliver aviation fuel at 85 airports in nine countries and produce and sell 750 different lubricant products.

Including employees at Statoil branded franchise stations, about 17,000 people work at our sites across Europe, while approximately 2,400 people work in our corporate headquarters, our eight national headquarters, our terminals and depots.